Mountview Estates

20 May 2025
By Maynard Paton

H1 2025 results summary for Mountview Estates (MTVW):

• Not the greatest of H1s, as “economic difficulties” and fewer property disposals combined to cut both revenue and profit by 5%, although the interim dividend was maintained and net asset value (NAV) crept to a record £103 per share.

• Property sales delivered a sub-60% gross margin for the fourth consecutive H1, which increasingly suggests ‘reversionary’ gains from regulated tenancies have inherently reduced and/or MTVW has simply overpaid for many past purchases.

• Properties bought and sold following the 2014 valuation continue to realise modest gains, with no obvious adverse trends concerning transaction costs and tenancy mix. The absence of another valuation has now left two non-execs ‘short-changed’ by selling shares below NAV.

• A new non-exec with a “keen focus on governance, risk and compliance” provides hope the board may adopt some fresh thinking on shareholder engagement, estate valuations and director pay, especially as protest votes have reached a record 33% of the share count. 

• Recent share purchases by the chief executive may have signalled a tantalising buying opportunity, while the £97 price now offers a 5.4% income, trades 6% below NAV and may be worth £169 if the group’s properties were all sold today at their ‘vacant possession’ value. I continue to hold.

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02 November 2024
By Maynard Paton

FY 2024 results summary for Mountview Estates (MTVW):

• A reasonable FY performance, which showed revenue up 8%, profit up 22% and the final dividend up 10% after buyers looking for “improvement potential” paid “good prices” for a more normal “profile” of properties.

• Sales by larger landlords allowed MTVW to spend a substantial £48m on new properties, but the advance to net asset value (NAV) was just 2% after MTVW took on greater debt, paid 6%-plus interest, incurred higher tax and sold properties for £59m.

• The absence of another formal estate valuation remains frustrating, especially given properties purchased after a 2014 valuation continue to realise subpar ‘reversionary’ gains and the overall property-sales gross margin was less than 60% for the third consecutive year.

• The board continues to be well paid, attract 30%-plus protest votes and enjoy entrenched support through a family concert party… although not every family member seems a die-hard shareholder and recent AGM remarks even hinted MTVW could one day undertake a trade sale.

• The £90 shares offer a 5.8% income, trade 12% below NAV — the steepest discount for at least ten years — and may be worth £182 if the group’s properties were all sold today at their vacant possession value. I continue to hold.

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17 May 2024
By Maynard Paton

H1 2024 results summary for Mountview Estates (MTVW):

• A satisfactory H1 performance, showing revenue up 5% and profit up 16% buoyed by the gross margin on property sales rebounding to a reassuring 59%.

• Despite a hefty £29m spent acquiring new properties, greater debt, higher interest costs, extra tax and the chunky dividend kept net asset value (NAV) at approximately £101 per share. 

• Properties purchased after a 2014 valuation and then sold look to have realised limited gains, and could explain why NAV growth has slowed and the share price has stagnated during recent years.

• The protracted search for a replacement non-exec could spark further tensions between the board and unhappy shareholders, with the chief executive still entrenched through family support albeit with no obvious successor.

• The £100 shares currently offer a 5% income, the highest for decades aside from the banking crash, and could be worth £189 if all the group’s properties were sold today at their vacant possession value. I continue to hold.

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28 October 2023
By Maynard Paton

FY 2023 results summary for Mountview Estates (MTVW):

• A lacklustre FY performance, with profit down 2% to the lowest level for ten years despite average property sales (excluding ground rents) rising 14% to a record £395k.

• Property sales achieving a 50% gross margin, the worst for 14 years, suggest properties purchased following a 2014 valuation have realised very limited premiums on disposal.   

• Debt remains under control at 12% of the property estate, although £56m was spent on new properties — the largest amount since FY 2008 — despite management talk of ongoing “difficult economic circumstances“.

• Protest votes against the board’s composition and remuneration continue to increase, with property investor David Pears among the unhappy shareholders asking questions at the latest AGM.

• The £100 shares trade at net asset value (NAV), which in theory prices in no future property gains, and offers a 5% income, the highest for decades aside from the banking crash. I continue to hold.

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16 May 2023
By Maynard Paton

Results summary for Mountview Estates (MTVW):

• A positive H1 2023 performance, with revenue up 21% and profit up 17% due to property selling prices gaining 19% and a greater number of properties sold. 

• A significant £26m spent on new properties implies buying opportunities are emerging as “difficult times” and “economic storms” are forecast.

• A 54% sales premium was realised against the 2014 Allsop valuation, and the remaining Allsop-valued properties now represent less than half of the property estate. 

• Net debt remains very modest at just 6% of the property estate and allowed the welcome declaration of a 250p per share/£10m special dividend. 

• The £115 shares trade at a lowly 13% premium to net asset value, which inched higher to a fresh £102 per share high, although the balance sheet could one day still be worth £200 per share. I continue to hold.

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02 September 2022
By Maynard Paton

Results summary for Mountview Estates (MTVW):

• A steady FY 2022 performance, buoyed by an H2 that saw property sales achieve a record £379k average and realise a 66% premium to their 2014 Allsop valuation. 

• The final dividend was lifted 11% while expenditure on new properties fell to a 13-year low after management expressed a desire to “not chase purchases at any price“.

• Net debt remains very modest at just 5% of the property estate and reflects management’s concerns of forthcoming “difficult economic circumstances“.

• Friction between major shareholders continues, with revised director-pay arrangements perhaps encouraging significant protest votes at the latest AGM.  

• Net asset value remains at £101 per share, although the balance sheet could be worth £210 per share assuming all owned properties enjoy immediate ‘reversionary’ gains and are then sold at fair-market value. I continue to hold.

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25 March 2022
By Maynard Paton

Results summary for Mountview Estates (MTVW):

• An acceptable H1 performance, albeit profit was suppressed by fewer property sales that in aggregate achieved a relatively low gross margin.

• Certain property disposals realising a record 65% premium to their 2014 valuation alongside an £11m special dividend do not suggest inherent trading difficulties.

• Management remarks of “difficult times that may lie ahead” may explain why expenditure on new properties remains low and net debt has been kept at just 4% of the property estate. 

• The special dividend, low expenditure and modest debt all perhaps signal a new ‘run off’ chapter, whereby the group consistently sells more properties than it buys.   

• Book value inched to a record £102 per share, although run-off guesstimates suggest total dividends following a complete estate disposal could total £264 per share. I continue to hold.

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15 July 2021
By Maynard Paton

Results summary for Mountview Estates (MTVW):

• A respectable performance supported by a remarkable H2 comeback, with full-year profit up 5% after declining 18% during a pandemic-disrupted H1.

• Property sales realising a welcome 1.55x premium to their 2014 valuation alongside the first dividend lift for three years suggest favourable near-term trading. 

• A small text change to AGM-related statements imply some unhappy shareholders have started to engage with management. 

• Debt of £22m stands at a 21-year low and represents just 5% of the £398m property estate.

• Book value inched to a record £101 per share, although my calculations still point to a balance sheet inherently worth beyond £200 per share. I continue to hold.

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04 December 2020
By Maynard Paton

Results summary for Mountview Estates (MTVW):

• A pandemic-affected H1 that showed revenue down 23% and profit down 18% following procedural delays to property sales.

• A maintained dividend, a lack for furloughed staff and rents up 1% did not signal inherent lockdown trouble. 

• Significant gross-margin enhancements may reflect an underlying step-change in performance and have favourable implications for valuation. 

• Expenditure on property purchases has picked up, with management hopeful of acquiring “exceptional opportunities”. Debt levels remain modest.

• Book value inched to a record £98 per share, although new profit assumptions now point to a balance sheet possibly worth up to £225 per share. I continue to hold.

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13 August 2020
By Maynard Paton

Results summary for Mountview Estates (MTVW):

• Standstill 2020 figures that showed 8% more properties sold at prices 9% lower than last year.

• A maintained dividend, a lack for furloughed staff and the directors currently being “happy in the auction room” underline some pandemic-resilient qualities. 

• Net debt representing a very modest 8% of the group’s property estate suggests significant scope to pick up any property bargains.

• This week’s AGM witnessed a further bout of protest votes against the independent non-executives, the board’s pay and the auditors.

• MTVW’s book value increased by 3% to a record £97 per share, although my calculations suggest the balance sheet could be worth £200-plus per share. I continue to hold.

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